Swiss-Belhotel International signs deal with giant China Tourism Group

Gavin Faull, chairman and president of Swiss-Belhotel International. Photo / Jason Oxenham.

New Zealand family-owned company Swiss-Belhotel International has signed a deal with a Chinese tourism giant that could more than double the number of hotels it manages worldwide.

Swiss-Belhotel’s chairman and president Gavin Faull said a memorandum of understanding signed with CTG Hotel in Beijing would allow his company to grow rapidly in China, and other countries.

CTG Hotel is part of the China Travel Group which is the the biggest tourism enterprise in China.

Just before the pandemic, the group had 43,000 staff,, total assets of RMB120.4 billion, (NZ$27b) and 584 wholly-owned or holding companies , which provided services for more than 60 million tourists each year.

The hotel group owns or manages more than 200 properties.

Swiss-Belhotel International operates 125 hotels and projects under 16 brands in 19 countries in Central Asia, Indonesia, The Middle East, Australia and New Zealand with 10 regional management hubs.

Faull said it was early days in the deal but the aim of the strategic partnership was to develop a platform for CTG Hotel and Swiss-Belhotel International to develop dual branding cooperation and diversified business development in China and abroad for both groups with a strong international perspective.

Talks between the two had been running for about two years and he said CTG was attracted to the strength of the Swiss-Belhotel brand Faull and his family has owned for more than 20 years.

‘’Based on the memorandum of strategic partnership, both parties will further enhance the mutual trust and mutual benefit, explore the dual branding business cooperation both in the domestic China market and the global market,’’ the companies said.

CTG owns or manages hotels in China, Britain, Thailand and other countries and cooperates with international hotel groups such as IHG, Marriott, Hilton, and Wyndham.

‘’This is a whole, conceptual change for us. It is not going to change the way we do things but it is going to give us scale,’’ said Faull.

He first learned the hotel business when a financial controller for the company that owned Hong Kong’s Peninsula Hotel in the mid-1970s.

The strategic partnership memorandum was recently signed at Grand Metropark Hotel Beijing between Faull and Fan Dongsheng, chairman of CTG Hotel.

The dual branding concept and cooperation will form a huge impact on the development of both CTG Hotel and Swiss-Belhotel.

Founded in 1987 in Hong Kong, Swiss-Belhotel describes itself as one of the fastest-growing international hotel management groups. It has 15,000 rooms under management and another 20,000 in the pipeline.

Faull said the deal would give his company deeper insight into the China market, where travel is recovering following the pandemic, and it could work with another CTG company, the China Travel Service.

‘’I’m getting up to 1000-room hotels that I can plug into the database source in China and then just just let it run.’’

Faull said he expected the relationship to evolve in the coming years.

During the depths of the pandemic, his company had to support hotel owners by slashing management fees and it had retained as many staff as it could.

With the new boom in travel, room rates were climbing sharply across his company’s portfolio.

They had gone up about 25 per cent in the last year but were moderating and he expected them to increase by about 10 per cent in the coming six months.

Total revenue had more than doubled in the past 12 months, compared to the previous period.

Grant Bradley is the Business Herald’s deputy editor and covers aviation and tourism. He has worked at the Herald since 1993.